E8-12 (Algo) Preparing Production, Direct Materials Purchases Budgets [LO 8-3b, c] Croy Incorporated has the following projected sales for the next five months: Month April May June July August Sales in Units 3,400 3,815 4,620 4,125 3,950 Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct materials cost $3.30 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,608 pounds. Required: 1. Determine budgeted production for April, May, and June. 2. Determine budgeted cost of direct materials purchased for April and May.

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E8-12 (Algo) Preparing Production, Direct Materials Purchases Budgets [LO 8-3b, c]
Croy Incorporated has the following projected sales for the next five months:
Sales in
Units
3,400
3,815
4,620
4, 125
3,950
Month
April
May
June
July
August
Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct
materials cost $3.30 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next
month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,608 pounds.
Required:
1. Determine budgeted production for April, May, and June.
2. Determine budgeted cost of direct materials purchased for April and May.
Transcribed Image Text:E8-12 (Algo) Preparing Production, Direct Materials Purchases Budgets [LO 8-3b, c] Croy Incorporated has the following projected sales for the next five months: Sales in Units 3,400 3,815 4,620 4, 125 3,950 Month April May June July August Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct materials cost $3.30 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,608 pounds. Required: 1. Determine budgeted production for April, May, and June. 2. Determine budgeted cost of direct materials purchased for April and May.
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